BUDGET 2007-08: MAKING LIFE BETTER IN SASKATCHEWAN

Released on March 22, 2007

Lower drug costs, lower taxes, incentives to keep young people here and major new investments in our highways and communities were a few of the highlights of the 2007-08 Budget delivered by Finance Minister Andrew Thomson today.

“This Budget makes life better for Saskatchewan families, by reducing drug costs, by helping young people start their careers here at home and by investing in highways and infrastructure to help keep the strong economy growing,” Thomson said in handing down the Province’s 14th consecutive balanced budget.

“This Budget makes life better for seniors by reducing the cost of prescription drugs,” Thomson said.  “The new $15 Senior’s Drug Plan is the most significant expansion of Medicare in a generation and will make drug therapies more affordable for Saskatchewan’s seniors.”

All seniors 65 years of age and over will pay no more than $15 per prescription for any drug covered by the formulary plan.  The new coverage goes into effect on July 1, and will provide an average annual benefit of $400 a year to the 115,000 seniors who are expected to take advantage of the program.  Lower-income seniors who currently don’t pay for their drugs will continue not to pay.

The Budget also permits income splitting for seniors for the first time, further benefiting this group.  The province will also legislate indexing of income tax benefits to protect the buying power of all taxpayers against inflation.  This builds on tax cuts the Minister announced late last year, including the two-point cut to the Provincial Sales Tax (PST).

The Budget also provides funds to shorten wait times and increase the number of diagnostic procedures and surgeries, and makes significant investments in children’s health.  In total, the province will commit a record $3.45 billion to support Medicare this year.

“Helping young people start their careers, right here at home is an important priority for our government,” Thomson said.  “The new Graduate Tax Exemption means that new post-secondary graduates will be able to earn $100,000 tax-free just by working here in Saskatchewan for their first five years.  This credit is good for young people, and will provide employers with an important new tool to attract graduates to the large numbers of new jobs available in today’s economy. 

“This builds on other measures we’ve taken to ensure there are opportunities for our young people here at home – like business tax cuts to encourage businesses to expand and create new jobs, adding more training seats and freezing university tuition for the third year in a row,” Thomson said.  “We are making life better for young people to work, study and build their futures.”

The Budget also makes record investments in infrastructure and our communities, with the largest ever budgeted capital program of $534.8 million.  This includes a record $127.3 million in revenue sharing for municipalities (a $30 million increase over Budget 2006-07), $58.2 million for municipal infrastructure, and $40 million to sport, culture, and recreation facilities through the Building Communities program.

BUDGET 2007-08 HIGHLIGHTS

Keeping the Strong Economy Going:

• On October 27, the Minister introduced the largest single tax cut in provincial history and cut the PST by two points to 5 per cent – this will provide $340 million in tax savings and $300/year in savings for an average family;
• This Budget will protect tax cuts by legislating the indexation of benefits under the Income Tax Act;
• The Budget for the first time introduces income splitting for seniors;
• The Business tax cuts introduced by the Calvert government to help create jobs and opportunities for young people continue this year, as the Budget provides $155 million to encourage jobs and growth by:
• Eliminating the Corporate Capital Tax (CCT) by July 2008; and
• Cutting the Corporate Income Tax (CIT) to 12 per cent by July 2008.
• Cut to small business taxes;
• This Budget provides $107 million in education property tax relief, and, subject to passage of the Federal Budget, we plan to deepen the tax cut from 8 per cent to 10 per cent on residential and commercial property and extend the program for two more years;

Making Saskatchewan an Even Better Place for Young People:

• This Budget introduces a special $10,000 annual Graduate Tax Exemption that, coupled with other credits, will permit recent post-secondary graduates to earn $20,000 tax free  in each of the first five years after graduation;
• Tuition rates remain frozen at 2004 levels until 2008, saving students $1,500 this year.  The province has committed $92 million to fully fund the tuition freeze since it was implemented;
• This Budget funds over 31,000 training spaces (a 24 per cent increase since 2004) including $23.7 million for 2,118 new training seats this year in health care, early childhood education and the trades, as well as 1,297 additional CareerStart training expansion opportunities; and
• This Budget provides over $3 million in literacy funding and creates 500 new licensed child care spaces, for a total of 9,300 spaces.
• Increasing Access to Health Care for Saskatchewan Families and Seniors:
• $15 Seniors’ Drug Plan;
• We are shortening wait times by:
• Providing 3,117 more MRI scans;
• Providing 5,455 more bone mineral density scans;
• Increasing access to cardiac catheterization lab and renal dialysis and clinic services; and
• Providing $1.6 million more for hip and knee replacements, for a total of 3,275 procedures this year.
• We are providing $78.5 million in Cancer Agency funding including a 17 per cent increase in funding for cancer drugs and medical supplies;
• This Budget extends health benefits for up to 30,000 low income workers;
• This Budget builds on our $100 million donation to the University of Saskatchewan for the Academic Health facility by expanding funding to the College of Medicine to provide more educational opportunities and spaces for medical and nursing education;
• This Budget provides an additional $90 million for unionized health care workers and $22.5 million for physicians and other professionals;
• We are investing $36.5 million for capital improvements to hospitals and health facilities and $22 million for medical equipment;
• We are improving services for children’s health by:
• Providing a targeted dental sealant program for Grades 1 and 7 students in community schools;
• Providing $2.25 million to improve access to mental health services and physio, speech and occupational therapies for children;
• Implementing coverage for insulin pumps for children under age 18;
• Expanding respite benefits for parents of children with complex medical needs; and
• Investing $3 million in programs addressing children with autism.

Building Highways and Infrastructure to Secure Growth:

• We are funding the largest budgeted infrastructure program ever at $534.8 million (up 31.3 per cent).  This includes support to:
• Complete twinning Highways 1, and 16 West;
• Rebuild rural highways; and
• Continue twinning Highway 11 north of Saskatoon.
• We are providing $30 million in new, unconditional funding for revenue sharing, bringing revenue sharing to a record $127.3 million, and providing $58.2 million for municipal infrastructure

OTHER:

• The March 19 federal Budget announced a $226 million one-time Equalization payment to Saskatchewan.  Of this total, $158 million will go toward debt reduction.  Since 2004, the Calvert government has paid off nearly $1 billion in provincial debt;
• This Budget provides a $10 monthly increase for Saskatchewan Assistance Plan (SAP) and Transitional Employment Allowance (TEA) recipients, and a $5 increase in the personal living allowance;
• We are investing $6.8 million in Community Based Organization (CBO) wage increases, meeting the three-year commitment;
• We are providing funds for stronger communities and child protection:
• $11 million for more child protection workers and services;
• $1.5 million for violence and gang reduction initiatives; and
• $4.4 million for increased policing and prosecutions and to expand outreach and treatment spaces for sexually exploited children.
• A stronger rural economy is supported through $21 million for the ethanol fuel tax rebate program and continued full funding of the Canadian Agricultural Income Stabilization (CAIS) program;
• Support for resources and research, including commitments to establish the InterVac at the University of Saskatchewan and support for a new Technology Innovation Centre at the University of Regina; as well, funding is increased for the Research Council and the Forestry Secretariat.

“Our new Budget builds on the values of Saskatchewan people and on the strength of the growing economy,” Thomson said.  “We are increasing access to healthcare for Saskatchewan seniors.  We are making Saskatchewan a better place for young people to work, study, and build their futures, right here at home.  We are investing in infrastructure and our communities to keep our strong economy growing.  We are making life better for Saskatchewan families.”

Budget documents and other information is available online at www.gov.sk.ca.

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For more information, contact:

Lorri Thacyk
Finance
Regina
Phone: 306-787-6605
Email: lthacyk@finance.gov.sk.ca
Cell: 306-537-0963